D,
I take it you are looking at a second hand one as the V40 is now called from this year a V50.
I have a 5 year old S40 TD SE model 145K on the clock an it's one of the best cars second hand cars you could buy. The What Car - Warranty survey placed both the 40 series cars in the top five respectively. Mine had it's MOT yesterday and sailed through (0.39 mg on the gas analyser is V good) The face lift model 2000-2002 are better as the engine is quieter but the build quality is rock solid as you would expect from a Volvo.
The V40 has quite a short overhang at the rear which I'm told like the BMW 3 series estate makes them better tow cars than many others. When we go camping there always seems a few around used as tow cars.
If I can give a bit of advice go for one with a full main dealer service history, and with as highest spec you can afford (SE, XS and CD are good examples of this) and have the rear suspension looked at it's the Achilles heel of a 40 series (every car has one common fault - with 40 series Volvo it's the suspension bushes and track rod end) both not dear fixes under